grasberg mine ownership

The new limit for foreign ownership would be 49 percent and could be divested gradually after five years of production, Wacik said. JAKARTA, Dec 21 — Indonesia today finalised a US$3.8 billion (RM15.9 billion) deal with US mining giant Freeport-McMoRan to take a 51 per cent stake in the giant Grasberg mine, the president said. World’s biggest gold mine nationalized in Indonesia. Prior to the $3.85bn transaction, Freeport held a 90.64% stake in the mine operation while Rio Tinto had a 40% participating interest. In 2017, in return of 51% of share ownership, the Government of Indonesia granted Freeport a special licence extending its mining right to 2041. It is the world's lowest-cost, largest producer of copper and gold.1 Figure J1. Impact on Freeport-McMoRan: Freeport-McMoRan’s Grasberg mine has been operating since 1972, represents 73% of Indonesia’s copper production, is one of the country’s largest taxpayers, and produced 1/5 th of Freeport’s $14.8B in revenue in 2016.The political uncertainty and threat of an export ban posed considerable risk if applied to copper … The mining method is open pit. Under the terms of a joint venture agreement between Rio Tinto and FCX, Rio Tinto is entitled to a direct 40 per cent share in resources discovered after 31 December 1994. Molybdenum concentrate, gold and silver are also produced by certain of FCX’s North America copper mines. The mine’s primary owner is mining giant Freeport-McMoran, and the company employs nearly 20,000 workers at the mine. Just last week, it was announced that the Arizona-based Freeport-McMoran Inc. (FRA:FPMB) just sold a huge stake in its Grasberg copper and gold mine located at Papua, Indonesia. Freeport yielded majority ownership of the Grasberg mine to state-owned PT Indonesia Asahan Aluminium (Inalum) last month in a $3.9 billion deal that also saw Rio Tinto leave the venture. “Freeport would still go to arbitration,” he said, while the government would also need to repay Freeport for all of its investments in the mine. This vast mine is the world's largest gold mine and third-largest copper mine. As part of the implementation of the mining law and its implementing regulations, Freeport and Rio handed over majority ownership of the Grasberg mine, the world’s second largest copper mine, to the Indonesian government. Freeport has also settled disputed mine ownership with the Indonesian government. PT-FI began open-pit mining of the Grasberg ore body in 1990. It’s an impasse indeed. In 2018, it was one of the first foreign owned and operated mines to transition to majority Indonesian ownership. With another millions of investment channeled, a winding road was built connecting both Ertsberg and Grasberg mining sites. This year has been unforgiving to Freeport McMoRan Inc, an invaluable player in Indonesia’s mining sector. Location of the Grasberg Mine Grasberg is an open pit mine owned and operated by PT Freeport Indonesia (PTFI), a A worker walks in an underground section of the Grasberg copper and gold mine. Our South America mines also ship a portion of their copper concentrate to Atlantic Copper, our wholly owned smelting and refining unit in … With over 50,000 employees and contractors, it's one of … Freeport Indonesia was established as a new legal entity in 1991, replacing Freeport Indonesia Incorporated which had operated the Grasberg mine since 1967. However, the company still wants to keep its hands on the mine’s operations. Rio has been entitled to a joint-venture share of the output under a 1996 agreement. Freeport-McMoran said it is continuing to work on a deal that would turn over 51 percent of the Grasberg Mine in Indonesia to local ownership. Indonesia’s approach to foreign ownership has shifted over time. Inalum now owns 51.2% of PT Freeport Indonesia, and Freeport holds the remaining stake. The footnotes below include all ownership changes over the three years. Freeport is planning large capital investments to develop underground mining facilities in the Grasberg mine as open pit resources are reaching depletion. It is estimated that the mine still holds ample reserves; 31 billion pounds of copper and 30.9 million ounces of gold. Freeport's contract to operate the Grasberg mine will end in 2021. The U.S.-based mining company said it would cut its ownership in the giant Grasberg copper and gold mine to 49%, ending a long-running dispute with Indonesia. On the other hand, Freeport is unlikely to consent to the Indonesian government’s demand for 51 percent ownership of the Grasberg mine without a protracted fight. The sale brings Freeport close to ending more than nine years of often fractious negotiations with Indonesia … The Phoenix, Arizona-based Freeport McMoRan Copper & Gold Inc. initially owned about 90 percent of the Grasberg mine since it began operating in Indonesia's easternmost province of Papua in 1973. The Grasberg mine in Indonesia is currently owned by FCX, who hold a 90.64 per cent interest, and the Government of Indonesia, who own the remaining 9.36 per cent. However, since 2014, Rio Tinto did not acquire benefits. Nevertheless, Indonesia’s ruthless treatment of Freeport will alert future investors. The Grasberg Mine is located in the Papua Province near the largest mountain in Papua, known as Puncak Jaya. A train at our Brockman 4 iron ore mine in the Pilbara, Western Australia Christian Sprogue photography 268 Annual report 2019 ... Grasberg – Joint Venture ... is as at the end of 2019. The Grasberg Mine is the largest gold mine and third largest copper mine on the planet. This is why proposed changes to environmental regulations are so important. The Indonesian government is demanding that American mining company Freeport increase the mining waste (known as tailings) disposed on land from 50% waste to 95%. State-owned mining firm Inalum will get a 51 percent interest in the Grasberg mine, from just under 10 percent now, Jakarta said. It is located in Mimika Regency, Papua, Indonesia near Puncak Jaya, the highest mountain in the country.It has 19,500 employees. Within the market, the Grasberg copper/gold mine has a unique status, as the largest mine in the country, a significant underground operation in a market dominated by open pit mining. The sale will reduce Freeport’s Grasberg mine ownership from 81 percent to 49 percent, losing its majority in the process. Mine Life. up of underground mining at the Grasberg mine. 1) Indonesia sets framework for Freeport to yield control of Grasberg mine. Located within the restive Indonesian province of Papua, the … Indonesia and Freeport-McMoRan Inc. may sign a new agreement as soon as this weekend that will lay out a road-map for the transfer of majority ownership of the giant Grasberg mine to a local firm, according to people familiar with the proposal. The problem is the Grasberg mine discharges approximately 230,000 tonnes or more of tailings directly into a natural river system every day, and it is expected the discharges will increase in the future as the mine expands. Rio Tinto Sells Interest in Grasberg Mine July 12, 2018 | Breaking News Rio Tinto, PT Indonesia Asahan Aluminium (Inalum), and Freeport McMoran Inc. (FCX) have signed a non-binding agreement relating to the future ownership of the Grasberg mine in Indonesia. The Phoenix, Arizona-based Freeport McMoRan Copper & Gold Inc. initially owned about 90 percent of the Grasberg mine since it began operating in Indonesia's easternmost province of Papua in 1973. Although PTFI’s 29,000-strong Grasberg work force has been hit by the Covid-19 outbreak, work on the $10 billion underground expansion continues apace, with FCX’s first quarter report only noting a deferred $200 million mill project. Freeport McMoran and Rio Tinto sold a majority interest in Grasberg to Indonesia’s state-owned aluminium mining company, Indonesia Asahan Aluminium (Inalum). Indonesia's state mining company PT Indonesia Asahan Aluminium (Inalum) has signed a non-binding agreement with Anglo-Australian mining firm Rio Tinto and Freeport-McMoRan to acquire controlling stake in giant Grasberg copper mine in Indonesia for $3.5bn. FCX’s South America mining operations include open-pit mining, sulfide ore concentrating, leaching and solution extraction/electrowinning. It’s an impasse indeed. Political risk in Indonesia is low to moderate. FCX has a 48.76 percent interest in PT-FI and manages its mining operations. The Ertsberg-Grasberg Mill is a surface and underground mining operation. Grasberg community visits. Italy’s Rio Tinto, PT Indonesia Asahan Aluminium, and Freeport McMoran Inc. (FCX) have signed a non-binding agreement in relation to the future ownership of the Grasberg mine in Indonesia. The Grasberg mine is currently 90.64% owned by Freeport and 9.36% by the government. In aggregate, the Grasberg open pit produced over 27 billion pounds of copper and 46 million ounces of gold in the 30-year period from 1990 through 2019. 4) Freeport’s exports fall short of quota. 2019. Through its subsidiary, PT-FI, FCX mines one of the world’s largest copper and gold deposits in the Grasberg minerals district in Papua, Indonesia. The Grasberg Mine is the largest gold mine and third largest copper mine on the planet. Indonesian state mining holding company PT Inalum is due to take over the majority stake in Grasberg under a long-heralded acquisition deal, which has to … JAKARTA, Indonesia (AP) — Indonesia finalized the transfer of majority control over a giant gold and copper mine from U.S. company Freeport-McMoRan, the government said Friday, in a long-awaited deal that boosts the president's re-election campaign. JAKARTA (Reuters) - Global mining giants Freeport McMoRan Inc and Rio Tinto have struck a binding accord to sell a majority stake in the world’s second-biggest copper mine, Grasberg, to Indonesia’s state mining company, Inalum for $3.85 billion. Mine operations consist of 8 distinct surface and underground workings. Earlier, Freeport-McMoran CEO Richard Adkersonrefused to comply with the Indonesian government’s demand to sell to Indonesian investors… For years, Freeport and its peers operated in Indonesia with little government interference. Although PTFI’s 29,000-strong Grasberg work force has been hit by the Covid-19 outbreak, work on the $10 billion underground expansion continues apace, with FCX’s first quarter report only noting a deferred $200 million mill project. Preamble. Despite some issues concerning the Indonesian government’s divestment plans for the province of Papua’s Grasberg mine, there are growing signs that Indonesia will get its way. Currently, half of … The slump was driven in part by weak. This is why proposed changes to environmental regulations are so important. Freeport has also settled disputed mine ownership with the Indonesian government. Specifically, these ratings reflect actual corporate behaviors rather than policies or affirmations of intent to adhere to best ESG practices. The Phoenix, Arizona-based Freeport McMoRan Copper & Gold Inc. initially owned about 90 percent of the … Global mining giants Freeport McMoRan Inc and Rio Tinto have struck a binding accord to sell a majority stake in the world’s second-biggest copper mine, Grasberg, to Indonesia’s state mining company, Inalum for $3.85 billion. Located some 60 miles north of Timika, at Tembagapura in Irian Jaya – the most easterly of Indonesia’s provinces – on the western half of the island of New Guinea, the Grasberg mine has the world’s single largest known gold reserve and the second largest copper reserves. This week, the Indonesian government and major miner Freeport McMoRan reached a “settlement” where Freeport’s ownership stake in the colossal Grasberg mine (located in Indonesia) will be reduced from 90.64% to 49%. Freeport shares rose. US mining giant Freeport finally reaches terms on the state-forced divestment of the Grasberg mine, a $3.8 billion deal President Joko Widodo characterized as an 'historic moment'. The ramp-up schedule at Grasberg (and other projects) will likely allow FCX to achieve copper sales of more than 4.4 billion pounds and gold sales of 1.6 million ounces in 2022, and a continued modest increase in volumes in 2023. uAdjusted EBITDA declined by 60% in 2019 to The Indonesian government has acquired a majority stake in the operator of the Grasberg mine, one of the world’s biggest copper and gold mines. Indonesia cannot simply wait until Freeport’s current mining contract expires in 2021 and then take ownership of its Grasberg copper mine, Jonan said. (where Freeport holds a 90.64% stake) principal asset is Papua, Indonesia-based Grasberg mine, which contains the worlds largest copper and gold reserves. But the simple fact that Grasberg's ownership, some 45 years into its productive life, remains the subject of debate between the miner that … In addition to copper and gold, PT-FI produces silver. Agreements end a long-drawn-out, three-way dispute over the mine, which has been centred on bringing Indonesia’s ownership of Grasberg up to 51%. Indonesia and Freeport-McMoRan will sign an agreement related to the giant Grasberg copper-and-gold mine this afternoon, according to a notice from the Finance Ministry. Grasberg, the second-largest copper mine in the world, has come under government control, with Jakarta securing a $3.85-billion deal with operator Freeport-McMoRan. Freeport McMoRan sold down its stake in the asset in 2018 to the Indonesian Government which now owns 51% of the operation. In return, Freeport would be authorized to continue to operate the project through 2041. Indonesia and Papua have long pushed for greater control over Grasberg and the new ownership structure may ease tensions over spoils from the world's second-biggest copper mine, a focal point for local separatists. 5) PT Freeport`s 51% divestment not negotiable: Indonesian minister. The main risk people see for the company is the recent change in ownership structure for the Grasberg mine in Indonesia. The world’s second largest copper mine announced that it was giving Indonesia a majority stake in its massive Grasberg copper and gold mine. The three parties around the behemoth Grasberg copper mine in Indonesia have signed a Heads of Agreement on the future ownership of the mine. Freeport-McMoRan (NYSE: FCX) explores the globe in search of natural resource mining opportunities. PT-FI’s results are consolidated in FCX’s financial statements. 2. Freeport expects block caving from the DMLZ mine to start mid-2019. Answer (1 of 7): Thanks Samudera For those who follow my comments, I have no doubt some believe I am unjustly harsh in my assessment of the folly of foreign investment in Indonesia. Initial production took place in 1972. Freeport-McMoran said it is continuing to work on a deal that would turn over 51 percent of the Grasberg Mine in Indonesia to local ownership. In aggregate, the Grasberg open pit produced over 27 billion pounds of copper and 46 million ounces of gold in the 30-year period from 1990 through 2019. Photo: AFP/Antara Foto. LMN member groups Partizans and TAPOL, and individual activists within LMN, have been working for many years on the conflicts and environmental damage caused by the Grasberg copper and gold mine in West Papua, a territory annexed by Indonesia in 1975 and in which an independence struggle has been conducted ever since. However, years of public outrage regarding foreign ownership of Indonesian resources peaked in 2009. It is operated by PT Freeport Indonesia (PT-FI), which used to be 90.64% owned by Freeport-McMoRan (FCX), including 9.36% owned … Now, after Adkerson’s about-face, the government and Adkerson must settle on the price local investors need to pay the company. A common issue was the attempts by foreign-owned enterprises to evade Indonesia's strict labour laws by calling their employees' contract workers . The Grasberg mine has the largest reserve of gold and the second-largest reserve of copper in the world. The final phase of the Grasberg open pit was mined during 2019, including the removal of the open pit ramps. The agreement requires US-based Freeport-McMoRan to cede its ownership stake, but it will keep operating the huge complex in the jungles of Indonesia's Papua province, officials said. The Grasberg Mine is a vast open pit mine in Papua, Indonesia, forming a crater an entire mile wide.For years it has been one of the most productive mines in … The Grasberg mine is owned and operated by Freeport Indonesia (PTFI), the principal and 91 per cent owned subsidiary of the US based Freeport-McMoRan Copper & Gold Inc. (FCX). Inalum will contribute the Rio Tinto interest to Freeport’s local unit, PT Freeport Indonesia, which will expand PT-FI’s asset base, Freeport explained. What happened Shares of copper and gold miner Freeport-McMoRan Inc (NYSE: FCX) fell around 5% in September. I wonder what the use of these ratings is and why the largest gold Indonesia and Papua have long pushed for greater control over Grasberg and the new ownership structure may ease tensions over spoils from the world's second-biggest copper mine, a focal point for local separatists. There is one known shaft. This is not an insignificant change; however, it does appear most of the details have been worked out with the government and the state owned entity (aka SOE) that will own 51% of the project. Freeport-McMoRan's Indonesian Grasberg mine. Deal should end a long-drawn-out, three-way dispute over the mine, which has been centred on bringing Indonesia’s ownership of Grasberg up to 51%. Grasberg is transitioning to underground mining and PT FI expects metal sales to approach 90% of post ramp-up targets by mid-2021, up from 68% in 4Q20 on an annualised basis. JAKARTA, Indonesia (AP) — Indonesia is allowing Freeport-McMoRan to continue operating a giant gold and copper mine after the U.S. company agreed Tuesday to relinquish majority ownership of it. Freeport McMoRan Copper & Gold holds just over 90 percent of Grasberg mine, and the rest is owned by the Indonesian government. In late August, it was announced that a long awaited deal between the US mining behemoth Freeport McMoRan and the Indonesian government was in its final stages. Photo: AFP/Antara Foto. After mining the final phase of the Grasberg open pit during 2019, the Grasberg minerals district includes the following underground mines that are being operated or in advanced development; the Grasberg Block Cave, the Deep Mill Level Zone (DMLZ), Big Gossan and the Deep Ore Zone (DOZ). A worker walks in an underground section of the Grasberg copper and gold mine. Currently, half of … Grasberg Open Pit, Indonesia. PT Freeport Indonesia also owns a 25% stake in PT Smelting that operates a copper smelter and Management also successfully navigated a tricky ownership change and transition from open pit to block cave at its Grasberg mine. Essentially, Indonesia wants to take On the other hand, Freeport is unlikely to consent to the Indonesian government’s demand for 51 percent ownership of the Grasberg mine without a protracted fight. The final phase of the Grasberg open pit was mined during 2019, including the removal of the open pit ramps. Recently, #IndonesiaKuasaiFreeport (#IndonesiaControlFreeport) became a trending topic among Indonesian on Twitter, because Freeport and the Indonesia government announced a deal that confirms Indonesia government increase stake in the asset to 51% and has majority control of the Grasberg mine.. On that agreement, state-owned PT Indonesia Asahan … Further, unlike other models with evenly weighted metrics, we assign context-sensitive relative weightings to our key metrics, based on market, regional, ownership or sector differences. The deal is expected to end to a long-drawn-out, three-way dispute over the mine, which has been centred on bringing local ownership of Grasberg up to 51%, a main requisite set by the Indonesian government to allow Freeport-McMoRan, operator of Grasberg, to keep doing so. A press release issued by Freeport said, “FCX (Freeport McMoRan Inc.) will agree to divest its ownership in PT-FI at fair market value so that Indonesia interests own 51 percent of PT-FI’s shares. Indonesia and Freeport-McMoRan Inc. may sign a new agreement as soon as this weekend that will lay out a road-map for the transfer of majority ownership of the giant Grasberg copper and gold mine to a local firm, according to people familiar with the proposal. The first-quarter update on the negotiations between Freeport and Indonesia highlighted the broad framework that the two sides agreed on in 2017. Global mining giants Freeport McMoRan Inc and Rio Tinto (Hanover: CRA1.HA - news) have struck a binding accord to sell a majority stake in the world's second-biggest copper mine, Grasberg, to Indonesia's state mining company, Inalum for $3.85 billion. Grasberg is a porphyry copper deposit located on the eastern portion of the island of New Guinea, high up in the Owen-Stanley range, the rugged backbone of New Guinea, 100 kilometres inland. US-based Freeport-McMoRan Copper & Gold holds a large stake in Freeport Indonesia. Local ownership of Grasberg will rise to 51 percent under a framework deal agreed in August that will see the U.S. miner divest a majority stake in local unit PT Freeport Indonesia -- of which Freeport currently owns 91 percent. Based in Indonesia, the Grasberg mine is another gold operation believed to one of the world’s largest – producing 1.1Moz in a year. Production from these mines is sold as concentrate or cathode under long-term contracts. Bristow has previously spoken of his interest in acquiring US mining company Freeport-McMoran’s Grasberg mine in Indonesia, which is the world’s largest gold mine and second largest copper mine. PT-FI began open-pit mining of the Grasberg ore body in 1990. The Indonesian government is demanding that American mining company Freeport increase the mining waste (known as tailings) disposed on land from 50% waste to 95%. The Grasberg mine in Indonesia is currently owned by FCX, who hold a 90.64 per cent interest, and the Government of Indonesia, who own the remaining 9.36 per cent. This 51% ownership rule will cause a 14% reduction on copper reserves and a 49% reduction on gold reserves and no impact on molybdenum, as Grasberg has no molybdenum. Rio Tinto has agreed to sell its interest in Grasberg, the world’s second-biggest copper mine, for $3.5bn, a deal that would open its share register to a wider range of investors. As of 2011, labour militancy was increasing with a major strike at the Grasberg mine, the world's largest gold mine as well as the second-largest copper mine, and numerous strikes elsewhere. However, the mine is exploited primarily for its copper at the moment. 3) Indonesia lays groundwork for transfer of Grasberg mine to local control. The Indonesian government is demanding that American mining company Freeport increase the mining waste (known as tailings) disposed on land from 50% waste to 95%. The reduction in ownership will go in favor of the Indonesian government, which feels it deserves a larger share of the mine. Rio Tinto acted as a partner to Freeport-McMoRan in terms of the ownership of the Grasberg mine, and 40 percent of the mine’s production above specific levels were allocated to the two companies. The Grasberg Mine is the largest gold mine and third largest copper mine on the planet. This is why proposed changes to environmental regulations are so important. Option to acquire 100% ownership of an advanced-stage, high-grade gold-silver project spanning 2,750 hectares within a historic mining district with production of over 2.0 million ounces of gold and 28 million ounces of silver at an average grade 37 g/t gold and 870 g/t silver. The company maintains its ownership stake through several of its subsidiaries. The transition to underground mining at the massive Grasberg operation in Indonesia continues apace, despite the major ownership changes that have seen PT Inalum’s and PT Indonesia’s collective share ownership of PT-FI total 51.24% and Freeport-McMoRan (FCX’s) share ownership fall to 48.76%. ... and Freeport-McMoran’s Grasberg mine in Indonesia. The Grasberg mine is located in the central highlands area of the south side of Papua (formerly Irian Jaya), Indonesia (see Figure J1). Indonesia’s Inalum to acquire majority stake in Grasberg copper mine for $3.85bn. 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